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PayPal

Popular P2P payments service Venmo, which is owned by PayPal, handled over $12bn in payments in the first quarter of 2018, but going forward, its users will have one less option when they go to send money to a friend.

Digital disruption has impacted just about every industry and one could make an argument that perhaps nowhere is the disruption more evident than in financial services.

Despite the fact that entrenched financial services firms, including big banks, have almost unfathomable amounts of money, in almost every financial services market, upstarts have sought to dethrone the entrenched players.

It’s very easy to spend the day in London and assume we are now fully entering into a ‘cashless society’.

Yesterday I used my contactless debit card to pay for everything I needed in the city: the tube, an unreasonably priced coffee, lunch, an unreasonably priced round of drinks, a tipsy purchase of some blu-rays I won’t actually watch.

In case you haven’t heard, online giants eBay and PayPal decided to part ways and become independent companies.

eBay will become eBay Marketplace, and PayPal will simply exist without eBay’s affiliation. The news comes as no surprise to many, since the ecommerce world has witnessed new, intimidating entrants such as Twitter and Facebook over the past few months.

Alternative payments only account for a small proportion of ecommerce transactions in the US and UK, however methods such as e-wallets, direct debits and cash on delivery continue to show strong growth in other regions.

Therefore it’s a feature that businesses can’t ignore, particularly at a time when many e-tailers are seeking to expand into international markets.

A new report from WorldPay highlights the way in which the use of alternative payments (AP) differs across global markets, with PayPal shown to be the most popular AP method globally, though Chinese companies Alipay and Tenpay are also popular and growing at a faster rate.

It’s estimated that alternative payments accounted for 43% of all online transactions in 2012, a figure that is predicted to rise to 59% by 2017 (though predictions should always be treated with some scepticism).

Perhaps before long we’ll all be more comfortable ‘buying with Google’ on mobile websites and apps.

The payment industry itself seems to be shaping up for a leap forward, with its leading conference opting for a rebrand. After 15 years as the Mobile Financial Services & NFC Summit the event has been renamed as the Mobile Wallet & Retail Innovation event in 2014.

This change reflects the slow clarification of what has been a bit of a curate’s egg until now. Confusion around NFC and smartphone hardware, as well as just what it is that the consumer wants, has distracted from exciting potential of the mobile wallet as a tool to buy on mobile websites.

In 2013, merchant-specific payment apps were arguably more successful than broader mobile payment solutions. The Starbucks app is regularly cited as one of the biggest successes thus far, used for 10% of all transactions and providing the customer with an experience enhanced by rewards. The point being, the customer wants more than just quicker payment.

Being the 800 pound gorilla of online payments isn’t easy. Despite PayPal’s ubiquity and the fact that it remains at the forefront of digital payments, including in the rapidly-evolving mobile payments space, the company’s reputation is mixed.

Serving millions upon millions of customers isn’t a walk in the park, and when something goes wrong with somebody’s money, the world is bound to hear about it one way or another.